Recovery strategies for dealers

The recent floods and cyclones have had a devastating effect on our entire country, and our thoughts are with those who have lost their homes and businesses.

One sector that has been significantly impacted by these events is the automotive industry with more than 10,000 cars damaged nationally. Of those, around 45 per cent have so far been assessed as write-offs.

Given the number of dealerships impacted by these disasters, it’s no surprise many are seeking innovative solutions to help navigate the aftermath and associated issues.

Over the past few weeks, I’ve been inundated with queries from car traders in the North Island wanting assistance in dealing with the increases in demand the industry is about to face and at a time when supply is significantly down.

Furthermore, dealers nationally who have stock to sell are wanting to know how to best take advantage of the surge in buyers entering the market.

So, first things first – how to gear up for the increase in demand that’s about to kick off.

At the time of writing, only about 10 per cent of insurance claims had been paid out. However, as that figure increases, so will the number of customers in the market for a new vehicle.

Unfortunately, this surge will hit at a time when stock levels are low with February’s figures showing new cars down by 18.2 per cent on last year and used-car imports down 27.6 per cent.

As a result, sourcing vehicles quickly, efficiently and at the right price is key to weathering the storm.

Gone are the days of commissioning staff to manually scour classified sites for a bargain. In this modern age, it’s all about utilising digital tools that can do the hard work for you.

Recently, several new platforms have hit the market that have been specifically created to assist car dealers in sourcing used vehicles from around the country.

Such software allows dealerships’ purchasers to run searches on a specific make, model and price range. From this they can obtain a list of all matching vehicles posted online across all classified sites at that particular point in time.

For increased efficiency, these tools often even allow users to create hotlists from their search criteria, which can send them a notification the minute a car matching their requirements is listed for sale.

Many dealers are already utilising these sourcing tools, which are enabling them to get ahead of the pack by building up their stock. So, by the time the surge in car buyers hits in the coming weeks and months, they will be well-prepared to cater to the level of demand.

Once a dealer has plenty of vehicles in stock, it’s important they advertise in order to move the cars as swiftly as possible. One of the most effective ways to do this is through live inventory advertising across social-media platforms and display networks.

Inventory ads allow you to promote all your in-stock vehicles to relevant audiences through the automatic publishing of advertisements created directly from your stock listings.

This means, for example, that if a person has shown interest in an SUV listed on your website, the next time they are scrolling Facebook or browsing the internet, an ad will appear promoting that same SUV and other similar ones you have on your yard.

In the US, more than 80 per cent of automotive campaigns include live inventory advertising.

Here in New Zealand, on the other hand, we’re only utilising it about 30 per cent of the time, which is far too low considering the efficacy of the medium for selling in-stock vehicles to in-market customers.

For many of us, it has been a shocker of a start to 2023. But as we’ve learned over the past few years, in order to overcome adversity we need to adapt to the changing circumstances and evolve accordingly.

For car dealers, this means embracing a digital strategy, utilising available tools and techniques to allow your business to keep driving forward no matter what the universe throws at you.